Correlation Between Alfen NV and FuelPositive Corp
Can any of the company-specific risk be diversified away by investing in both Alfen NV and FuelPositive Corp at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Alfen NV and FuelPositive Corp into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Alfen NV and FuelPositive Corp, you can compare the effects of market volatilities on Alfen NV and FuelPositive Corp and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Alfen NV with a short position of FuelPositive Corp. Check out your portfolio center. Please also check ongoing floating volatility patterns of Alfen NV and FuelPositive Corp.
Diversification Opportunities for Alfen NV and FuelPositive Corp
0.12 | Correlation Coefficient |
Average diversification
The 3 months correlation between Alfen and FuelPositive is 0.12. Overlapping area represents the amount of risk that can be diversified away by holding Alfen NV and FuelPositive Corp in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on FuelPositive Corp and Alfen NV is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Alfen NV are associated (or correlated) with FuelPositive Corp. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of FuelPositive Corp has no effect on the direction of Alfen NV i.e., Alfen NV and FuelPositive Corp go up and down completely randomly.
Pair Corralation between Alfen NV and FuelPositive Corp
Assuming the 90 days horizon Alfen NV is expected to under-perform the FuelPositive Corp. But the otc stock apears to be less risky and, when comparing its historical volatility, Alfen NV is 3.29 times less risky than FuelPositive Corp. The otc stock trades about -0.12 of its potential returns per unit of risk. The FuelPositive Corp is currently generating about 0.02 of returns per unit of risk over similar time horizon. If you would invest 12.00 in FuelPositive Corp on August 28, 2024 and sell it today you would lose (10.00) from holding FuelPositive Corp or give up 83.33% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 86.26% |
| Values | Daily Returns |
Alfen NV vs. FuelPositive Corp
Performance |
| Timeline |
| Alfen NV |
| FuelPositive Corp |
Alfen NV and FuelPositive Corp Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Alfen NV and FuelPositive Corp
The main advantage of trading using opposite Alfen NV and FuelPositive Corp positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Alfen NV position performs unexpectedly, FuelPositive Corp can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in FuelPositive Corp will offset losses from the drop in FuelPositive Corp's long position.| Alfen NV vs. Copa Holdings SA | Alfen NV vs. United Airlines Holdings | Alfen NV vs. Delta Air Lines | Alfen NV vs. SkyWest |
| FuelPositive Corp vs. AmmPower Corp | FuelPositive Corp vs. FuelPositive Corp | FuelPositive Corp vs. Graphene Manufacturing Group | FuelPositive Corp vs. Exro Technologies |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stocks Directory module to find actively traded stocks across global markets.
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